LONDON--(EON: Enhanced Online News)--According to the latest market study released by Technavio, the global third party logistics (3PL) market is expected to grow at a CAGR of close to 6% during the forecast period.
“3PL service providers offer advanced solutions to manufacturers that help them in delivering products efficiently and quickly. The vendors in the market provide services to satisfy all the supply chain needs of manufacturers, leading to a decrease in overall costs for logistics operations”
This research report titled ‘Global Third Party Logistics (3PL) Market 2017-2021’ provides an in-depth analysis of the market in terms of revenue and emerging market trends. This market research report also includes up to date analysis and forecasts for various market segments and all geographical regions.
There is an increase in trade agreements among nations due to the resurgence of the global economy, which has turned out to be one of the biggest drivers of the global 3PL market. These free trade agreements are instrumental in removing supply chain constraints, simplifying customs procedures, reducing tariffs, and improving the transit time and efficiency of business operations, thus driving the market to growth.
Other important factors responsible for the growth of this market are the advances of e-commerce in retail sector, growing number of government initiatives for infrastructure development, and increase in exports and imports. Collectively, these factors are expected to push the global 3PL market from being valued at USD 750.51 billion in 2016 to USD 996.37 billion in 2021.
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Based on end-users, the report categorizes the global 3PL market into the following segments:
- Manufacturing Industry
- Consumer goods industry
- Retail industry
- Automotive industry
- Food and beverage industry
The top four revenue generating end-user segments in the global 3PL market are discussed below:
“3PL service providers offer advanced solutions to manufacturers that help them in delivering products efficiently and quickly. The vendors in the market provide services to satisfy all the supply chain needs of manufacturers, leading to a decrease in overall costs for logistics operations,” says Abhay Sinha, one of the lead analysts at Technavio for logistics research.
The global manufacturing industry has been growing steadily and accounted for a 13% of the global GDP in 2015. During the forecast period, most of this growth will generate from developing countries like India, where policy reforms support the large-scale development of new manufacturing industries. These manufacturing plants extensively utilize a variety of 3PL services for everything, from procuring raw materials to shipping products to end-users. This factor is expected to generate significant revenue for the 3PL market during the forecast period.
Consumer goods industry
The demand for consumer goods is increasing rapidly, especially from swiftly developing economies like India and China, which are expected to account for almost 30% of the global market in the next decade. Increasing internet penetration is snowballing the access to online retail channels, combined with the rising disposable incomes, there is an ever-increasing demand for all categories of consumer goods. The growing markets and the online retail channels are creating a huge demand for 3PL services.
By 2021, it is expected that more than one billion new consumers globally will be spending USD 10 to USD 100 per day on consumer goods. In the US, e-commerce represented over 8% and China for nearly 16% of all retail sales in 2016.
The increasing disposable incomes have resulted in the growth of many industries, of which general retail segment is one of the biggest. In 2015, the total retail sales amounted to USD 22.05 trillion, underlining the potential of the market. Combined with the increasing internet penetration, consumers are no longer restricted by geography to fulfil their demands. They have access to the global market, which offers a plethora of products not available locally. This sector is one of the largest users of logistics services, accounting for almost 16% of the total revenue generated from the global 3PL market.
“Automotive manufacturing is one of the largest contributors of the manufacturing sector, with China, the US. Japan, South Korea and Thailand in the lead. In 2015 alone, these five countries together accounted for the manufacture of 52.35 million automotive vehicles, including light heavy trucks, commercial vehicles, and passenger cars,” says Abhay.
Additionally, there is a constantly increasing demand for luxury, high-end cars due to the rise in disposable income, especially in developing countries. This high demand for automotive vehicles in various regions will create a healthy demand for 3PL services.
The top vendors highlighted by Technavio’s research analysts in this report are:
- C. H. Robinson
- CEVA Logistics
- DB Schenker
- Deutsche Post HL
- Kuehne + Nagel
- Nippon Express
Browse Related Reports:
- 3PL Market in the US 2016-2020
- Logistics Market in the APAC Region 2016-2020
- 3PL Market in Brazil 2016-2020
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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